“The Philippines is under a free trade enterprise. Prices are set by companies, not by the government,” said Department of Trade and Industry (DTI) Secretary Ramon M. Lopez on the determination of prices of goods in the market.
“For basic necessities and prime commodities (BNPC), however, DTI’s role is to help temper any price increase to protect the consumers, noting that there are only 9 manufactured basic necessities and 12 prime commodity items under the Price Act. The government closely monitors their prices as mandated by law and negotiates with manufacturers on the most reasonable price adjustments based on production cost movements. DTI studies the justifications based on the most reasonable cost to consumers while ensuring a fair return of investment for business. After negotiation, DTI finalizes and publishes the SRPs and closely monitors retail trade for compliance,” he added.
Last Saturday, the Department released the latest SRP list of BNPCs for the guidance and information of consumers and retailers.
"The recent SRP list showed that only 26 out of 235 Shelf Keeping Units (SKUs) have increased their prices, which is only 11% of the total SKUs that we monitor. The remaining 209 SKUs or 89% of the total products listed in the SRP bulletin did not increase. 17 out of the 26 SKUs (65%) that adjusted in prices have less than Php1.00 increase," explained Trade Secretary Lopez.
He further added, "Business principles dictate that companies do not necessarily increase their prices easily as they are also afraid of losing patronage to competition. As much as possible, manufacturers absorb rising production costs to keep their loyal customers.”
For canned sardines, its major raw material that is tamban (herring)is now priced at Php32.00 to Php34.00 per kilo. Prices of wheat flour, carton, wrappers, and seasoning have also increased and affected the prices of instant noodles. Raw and imported vinegar, and fish extract pushed upward the prices of condiments while warehousing and logistics affected cost of toilet soap.
The DTI noted that there was even a delayed price increase for some of these SKUs due to the three-month hold off that manufacturers accommodated last year to mitigate the effects of rising inflation on food prices. If these price adjustment requests are held off again, the DTI says this may result to bigger price increases, business closure and job losses in the future.
Nevertheless, consumers still get to choose among cheaper variants since majority of the SKUs in the SRP list did not increase their prices. Commodities such as processed milk, coffee refill, coffee 3-in-1, bread, detergent/laundry soap, candles, canned meat, and batteries all retained their previous SRPs.
The DTI vows to continue its intensified monitoring and enforcement efforts to ensure the reasonableness of prices and adequacy of supply of basic and prime goods in the market.
Date of Release: 7 May 2019